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Reply #4: Not always true... [View All]

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Home » Discuss » Topic Forums » Economy Donate to DU
FormerDittoHead Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jan-26-05 05:55 PM
Response to Reply #1
4. Not always true...
Prices of goods and services are not *all* "cost plus mark-up".

Pricing (what consumers pay) is much more complicated that that.

Competition more often sets the price of goods than a business's expenses, and that competition can come from other countries.

Demand often is what sets the cost charged to consumers. Regardless of expenses, for some goods and services, businesses can only charge a set amount for some things, if people are simply unwilling to buy things above a certain price.

Also, what some businesses pay in taxes is significantly different from others selling the same goods. Do they reduce their prices for paying lower taxes? HELL NO!

To conclude: business taxes are NOT simply passed along to the customer.
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